Will Legal Pot Hurt the Booze Business? What Do You Think?
As the legalization of recreational marijuana gains momentum across the United States with public support at an all-time high, many advocates eagerly await to see what effect legalization will have on big alcohol. Will it be forced to fight for market share? Or is alcohol so heavily ingrained in our society that pot legalization will barely create a ripple with booze consumption remaining unaffected?
In the cannabis reform movement, it is an article of faith that the more pot is legally accessible, the less booze will be consumed, but is there evidence to support that theory? The answer to the overall question likely depends on how cannabis and alcohol interact in our culture, that is, whether pot will complement booze and vice versa or whether people will choose pot as an alternative to drinking.
As Forbes explains, if the two substances are complements, then states legalizing marijuana would expect to see more consumption on both sides, which may increase competition and likely exacerbate pre-existing health concerns about over-consumption of alcohol, particularly in this era of mixing red bull and other highly caffeinated drinks with booze. However, if pot truly becomes a substitute for alcohol, than legalizing marijuana may reduce alcohol consumption.
According to economists, D. Mark Anderson and Daniel Rees, co-authors of the most recent research on this topic published in theJournal of Policy Analysis and Management, marijuana and alcohol are substitutes rather than complementary substances.
The co-authors cite a number of prior studies ranging from 2001-2013, which illustrate that as marijuana becomes more readily available, adults respond by drinking less, not more, with pot legalization associated with a reduction in heavy drinking amongst 18 to 29-year-olds and a five percent decrease in beer sales.
“We expect that legalization of recreational marijuana will lead to increased marijuana consumption coupled with decreased alcohol consumption. As a consequence, these states will experience a reduction in the social harms resulting from alcohol use,” the study revealed.
Consequently, economists predict pot legalization will produce a number of public health benefits, which will directly impact upon alcohol.
“There are many social benefits to legalizing marijuana. With legalization comes the benefit of reduced traffic fatalities and decreases in other social harms caused by alcohol consumption such as the rate of suicide. Overall, we predict the public-health benefits of legalization to be positive,” Anderson explained to AlterNet.
This is consistent with a 2011 study comparing the relative physical, psychological, and social harms of alcohol to cannabis, which showed that alcohol was considered to be more than twice as harmful as cannabis to users and five times more harmful as cannabis to society. Co-author of that study, Dr. David Nutt, stood by those findings this week, claiming that alcohol consumption could fall as much as 25 percent if Dutch-style cannabis cafes were allowed.
So how has big alcohol responded to such claims about its “beloved beverages?” Last week, AlterNet reported that booze lobbyists were becoming increasingly pissed off at weed campaigns for drawing such comparisons between the two substances, which they say paint alcohol in a bad light.
At issue, was the latest move by pot lobbyist group, Marijuana Policy Project (MPP) in displaying signs around Portland, Maine leading up to the city’s latest pot victory, which read: “I prefer marijuana over alcohol because it doesn't make me rowdy or reckless," and "I prefer marijuana over alcohol because it's less harmful to my body.”
Similar previous campaigns likening the health effects of the two substances such as the “Yes on 64” Campaign to Regulate Marijuana Like Alcohol have also been successful in debunking the myth that alcohol is safer than pot, resulting in legalization of recreational marijuana use in Colorado.
But while alcohol lobbyists have been critical of such campaigns in the past, pot activists have hit back saying comparisons are fair game since pot has been subject to a decade-long onslaught of government propaganda condemning its 'supposed harm' while alcohol continues to be glamorized and normalized.
According to Mason Tvert, from MPP and co-author of, Marijuana is safer: so why are we driving people to drink?, it is more than necessary to discuss marijuana’s harm relative to alcohol because our nation clearly accepts that alcohol, which is a more harmful substance, should be legal, while marijuana remains prohibited.
“The [anti-marijuana] discussion is purely about marijuana being addictive and harmful. We can’t just talk about that without highlighting that we accept alcohol use in society and marijuana is less addictive and less harmful than that substance. We believe adults should have the right to use marijuana responsibly because it is irrational to punish those who use a less harmful substance instead,” he said.
Paul Armentano, Deputy Director of National Organization for the Reform of Marijuana Laws (NORML) and co-author of ‘Marijuana Is Safer, So Why Are We Driving People to Drink?’ agrees:
“This is not an attack on alcohol. Nobody is calling to repeal alcohol. We’re simply talking about a principle and public policy that we have in place for alcohol that we argue is good public policy and should therefore be applied to marijuana rather than the current alternative prohibition. We felt this comparison was apt in order to ask people: why do we embrace an objectively more harmful substance, while we criminalize those who choose the safer substance? The irony of this policy is that if one is to step back and assess it via any objective metric, they would see alcohol poses greater potential risks to both the individual users who consume it and to society as a whole, as opposed to cannabis which unlike alcohol is not legal and its users are stigmatized and criminalized for using a safer system,” he said.
Nonetheless, the beer industry remains resistant. Last week, Chris Thorne of the Beer Institute told the National Journal that it’s a red herring to compare alcohol to pot:
"We believe it's misleading to compare marijuana to beer. Beer is distinctly different both as a product and an industry. Factually speaking, beer has been a welcome part of American life for a long time. The vast majority drinks responsibly, so having caricatures won't really influence people,” he said.
Yet, when AlterNet pressed The Beer Institute to clarify its position given its prior vocal comments, the company backpedaled in delivering an utterly political and indifferent statement: “Beer importers are neutral on the issue of legalization.”
Likewise, the National Beer Wholesalers Association remained ambivalent, expressing to AlterNet: “NBWA is monitoring the growing debate about its legalization and the potential policy implications."
Moreover, the California Beer and Beverage Distributors (CBBD) refused AlterNet’s continuous requests to comment on the issue, which isn’t surprising considering in 2010 it spent thousands of dollars campaigning against recreational marijuana consumption in California’s Prop 19 battle, which pro-marijuana groups say was motivated by a fear of competition.
So why has the liquor biz which formerly had a lot to say about this topic suddenly gone mum on the issue of legalization? Is it afraid of the ramifications of legalizing pot on alcohol consumption or does is it simply see it as a non-issue given how entrenched alcohol already is in America’s beer culture?
Undoubtedly, if pot leads to a reduction in alcohol consumption even by five percent, alcohol’s profit margins will take a hit. Yet, according to Mason Tvert, alcohol really has no cause for concern, as the liquor industry isn’t going anywhere.
"I wouldn’t suggest that at present alcohol is keeping marijuana illegal. Obviously competition and substitution are at the root of their concern but I don’t think it’s something they need to worry about. Alcohol is widely embraced by the public and engrained in our culture. We have stadiums named after beer. I don’t see that changing anytime soon irrespective of marijuana legalization,” he said.
Moreover, Tvert says alcohol doesn’t really have all that much to gain by keeping pot illegal.
“If their fear is competition and they work to make it illegal, there’s going to be a lot of people upset by that and not going to want to purchase it, particularly in light of public opinion which demonstrates that the majority of Americans are in favor of legalization. Working to maintain marijuana prohibition would be a terrible PR move, as CBBD found out a couple of years ago when they got slammed for spending thousands of dollars to defeat cannabis legislation in California," he said.
Similarly, Armentano says he can’t see marijuana ever being a direct, significant competition to alcohol, especially since people who use it do so despite its prohibition and those opposed to it publicly state that decision has little to do with criminalization or legal ramifications, but rather, they just don’t like the way it makes them feel or the way they think it would make them feel:
“Are they complementary? Nobody has strong data one-way or the other. There hasn’t been a nation or even a region of a nation that has allowed for both legal markets to exist side-by-side with one another and to act similarly as far as levels of production, or number of retail sale outlets go, so we don’t know. That said, alcohol is ubiquitous in this country, I would be hard-pressed to think that marijuana would ever reach that level.
“My instinct tells me that there will be heavily-imposed restrictions on the way it’s marketed to the public that are far more restrictive than the regulations that right now are governing the alcohol industry. If society and lawmakers were to say, ‘Yes lets bring marijuana into the free market,’ it wouldn’t be an entirely free market,” he said.
Of course, not all in the alcohol biz are opposed to marijuana law reform. In fact, a few companies have begun to show their support, which suggests that perhaps the booze tide could be changing, slowly but surely.
Last week Budweiser teamed up with marijuana in an effort to bring about legalization to Arkansas by sponsoring the AMCA Music and Art Festival, San Francisco Chronicle reported. The collaboration was aimed at promoting the Arkansas Medical Cannabis Act initiative for the 2014 ballot. The giant beer company even went so far as to promise to donate a portion of its beer sales to the legalization group Arkansans for Compassionate Care. What’s more, earlier this year, Redhook Brewery announced a ‘hemp beer’ called “Joint Effort” brewed from hemp seeds to celebrate cannabis legalization in Washington.
Such collaborative measures have supporters hopeful that as more states move to vote on the issue in the coming years and recreational pot shops are expected to open their doors for the first time in history on January 1, 2014, that other companies will follow suit and jump on the pot bandwagon in a bid to remove the fear and stigma surrounding pot in order to give marijuana the same chance that liquor received a century ago when its prohibition was removed.
After all, as Armentano explains, no one is arguing that marijuana is innocuous, only that the relative harm compared to alcohol is nominal. If as a society we acknowledge it is better public policy to legalize and regulate alcohol because of its potential harms to users, than by that same logic, it would be a better public health initiative to regulate cannabis for the same reason:
“Right now, we have no controls on cannabis; there’s an absence of control. The way to control it is to to regulate it but we only have regulation after legalization. That is what we did with alcohol, that’s what we ought to do with marijuana based on the same principles."